Aides: Obama Not ruling out taxing health benefits

The New York Times (3/15, A1, Calmes, Pear), in a front-page article titled “Administration Is Open To Taxing Health Benefits,” reported the Obama administration “is signaling to Congress that the president could support taxing some employee health benefits, as several influential lawmakers and many economists favor, to help pay for overhauling the healthcare system. The proposal is politically problematic for President Obama, however, since it is similar to one he denounced in the presidential campaign as ‘the largest middle-class tax increase in history.'” As lawmakers prepare to introduce healthcare reform proposals “several advisers say that while he will not propose changing the tax-free status of employee health benefits, neither will he oppose it if Congress does so.”

The AP (3/16) reports one of President Obama’s “leading economic advisers says the White House is opposed to taxing health insurance,” but Christine Romer, chairwoman of the White House Council of Economic Advisors, “is not ruling it out.” As a candidate, Obama “opposed such taxes and called them ‘a multi-trillion dollar tax hike.’ Romer says the president remains opposed. But when she was pushed on its during a talk show appearance, she said nothing was being taken off the table.”

On its website the ABC News (3/15, Tapper) “Political Punch” blog reports, “Obama administration aides immediately characterized the Times report as much ado about very little, saying the idea is on the proverbial table along with nearly every healthcare reform idea under the sun, but not being pushed or particularly supported by the White House.” On Fox News Sunday White House economic adviser Austan Goolsbee said, “I saw this, the article you’re talking about. … I thought that was highly overstated. That is not in the president’s budget. The president’s budget — you have it there on the table. It does not include this provision. This appears to be coming from (when) the administration and representatives of the administration went to Congress and said, ‘We are open to all ideas to talk about health reform.'”

The Washington Times (3/16) reports, “During the presidential campaign, Mr. Obama took a much harsher tack, running a spate of ads denouncing Republican opponent John McCain’s healthcare plan on precisely those grounds – that it was partially financed by taxes from counting the value of medical insurance as taxable income.”